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Smith Distributors, Inc., supplies ice cream shops with various toppings for making sundaes. On November...

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Accounting

Smith Distributors, Inc., supplies ice cream shops with various toppings for making sundaes. On November 17, 2021, a fire resulted in the loss of all of the toppings stored in one section of the warehouse. The company must provide its insurance company with an estimate of the amount of inventory lost. The following information is available from the company's accounting records:

Fruit Toppings Marshmallow Toppings Chocolate Toppings
Inventory, January 1, 2021 $ 30,000 $ 8,000 $ 4,000
Net purchases through Nov. 17 200,000 46,000 13,000
Net sales through Nov. 17 250,000 65,000 21,000
Historical gross profit ratio 15 % 25 % 30 %

Required: 1. Calculate the estimated cost of each of the toppings lost in the fire.

Estimated cost of
Toppings lost inventory
Fruit
Marshmallow
Chocolate

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